Question

CHI HW Saved Cherokee Inc. is a merchandiser that provided the following information: Amount 12,000 17 $ Number of units sold Selling price per unit Variable selling expense per unit Variable administrative expense per unit Total fixed selling expense Total fixed administrative expense Beginning merchandise inventory Ending merchandise inventory Merchandise purchases $ 22,000 $ 13,000 $ 9,000 $ 24,000 $ 90,000 Required: 1. Prepare a traditional income statement. 2. Prepare a contribution format income statement. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare a traditional income statement. < Prev 2 of 6 Next > 00 OOO

Answer 1

1.

Traditional Income Statement
Sales		$    2,04,000
Cost of Goods Sold		$       75,000
Gross Margin		$    1,29,000
Selling and administrative Expenses
Variable Selling Expense	$          24,000
Variable Administrative Expense	$          36,000
Fixed Selling Expense	$          22,000
Fixed Administrative Expense	$          13,000	$       95,000
Net Operating Income		$       34,000

Variable costing per product is not provided for variable costing income statement